Program for Alternative Funding of Employee and Retiree Benefits

ABSTRACT

An insurance program for funding benefits by maintaining assets in the insurance program that includes an employer or employee owned trust account and at least one life insurance contract or non-cancelable accident and health insurance contract obtained directly or indirectly from a captive insurance company. The life insurance contract or non-cancelable accident and health insurance contract is purchased with assets from the trust account and the captive insurance company is at least partially owned by the employer. When paying or reimbursing benefits, the employer or the trust may pay the benefit and if the employer pays the benefit, the trust may reimburse the employer.

CROSS-REFERENCE TO RELATED APPLICATION

This application is a Continuation of U.S. Application No. 13/248,737filed on Sep. 29, 2011, which is a Continuation of Ser. No. 12/801,423filed on Jun. 8, 2010, which is a Continuation of U.S. application Ser.No. 11/157,161 filed on Jun. 21, 2005, which is a Continuation-in-Partof U.S. application Ser. No. 10/995,325, filed on Nov. 24, 2004. Thecontents of each of these applications, in their entirety, are hereinincorporated by reference.

BACKGROUND OF THE INVENTION

1. Field of the Invention

The present invention relates generally to facilitating and/or providingbenefits to employees and retirees. More specifically, the presentinvention relates to a computer implemented system and method forconfiguring, optimizing, managing and tracking alternative funding ofemployee and retiree benefits and benefit plans.

2. Description of Related Art

Conventionally, employers have provided benefits to employees andretirees and have paid for these benefits using employer's funds. Morerecently, benefits, including medical costs, have become very expensiveand as a result, employers have scaled their benefit offerings and, insome cases, insisted that the employees pay a portion of the cost forthese benefits. Some corporations have also required that employees relyentirely on self funded retirement.

Additionally, commonly accepted accounting practices have essentiallyforced employers to reflect these benefits to employees and retirees asliabilities on corporate financial statements.

This trend has put a substantial strain on employers, on employees andtheir families, and on retirees and their families that were promisedbenefits after retirement. Employers appear to carry costly liabilitiesand employees are having to pay more for fewer services. Accordingly, asystem is needed to assist employers in controlling the cost of theirprograms and to ensure that employers are financially able to providethe maximum affordable benefits to employees and retirees and that theemployees and retirees get an appropriate level of benefits.

BRIEF SUMMARY OF THE INVENTION

In one embodiment, the present invention provides a method for fundingbenefits by maintaining assets in an investment program comprising, anemployer or employee owned trust account and at least one life insurancecontract or non-cancelable accident and health insurance contractobtained directly or indirectly from a captive insurance company. Thelife insurance contract or non-cancelable accident and health insurancecontract is purchased with assets from the trust account and the captiveinsurance company is a least partially owned by the employer. Whenpaying or reimbursing benefits, the employer or the trust may pay thebenefit and if the employer pays the benefit, the trust may reimbursethe employer.

In another embodiment, the present invention allows the trust or thecaptive insurance company to invest its assets in commercially availablevehicles to generate additional assets, and in certain embodiments theinvestment may be in the employer's own securities including short termcommercial paper.

In yet another embodiment, the present invention provides a method offunding benefits where the captive insurance company is wholly orpartially owned by the employer, is a rent-a-captive, a protective cellcaptive, or any other form of a captive insurance company as defined andauthorized by the respective domicile of the captive insurance company.

In yet another embodiment, the present invention provides benefitsincluding, for example, health care benefits, retirement benefits,executive compensation, and/or life insurance. These benefits may beprovided to employees and/or retirees.

In yet another embodiment, the non-cancelable accident and healthinsurance contract is a health insurance contract and the insurancecompany pays claims on behalf of the insured to the trust.

In yet another embodiment, the present invention utilizes a trustincluding, for example, a Voluntary Employee Beneficiary Association(VEBA) Trust or a Rabbi Trust as the beneficiary and names at least oneemployee receiving benefits from the employer as the insured person onthe life insurance contract.

BRIEF DESCRIPTION OF THE DRAWINGS

Additional, features, and advantages of the various embodiments of thepresent invention will become apparent from the following detaileddescription of embodiments of the invention in conjunction with theaccompanying drawings where like reference numerals indicate likefeatures, in which:

FIG. 1 is a schematic drawing of a funding program for employee andretiree benefits in accordance with an embodiment of the presentinvention;

FIG. 2 is a schematic drawing of a funding program for employee andretiree benefits in accordance with an embodiment of the presentinvention;

FIG. 3 is a flow chart illustrating the operation of a funding programin accordance with an embodiment of the present invention;

FIG. 4 is a flow chart illustrating how benefits may be paid when anemployee/retiree makes a claim in accordance with an embodiment of thepresent invention;

FIG. 5 is a flow chart illustrating how benefits or claims on behalf ofan insured are paid in accordance with an embodiment of the presentinvention; and

FIG. 6 is a flow chart of a computer system for implementing a fundingprogram in accordance with an embodiment of the present invention.

DETAILED DESCRIPTION OF EMBODIMENTS

FIG. 1 is a schematic drawing of an alternative funding program foremployee and retiree benefits in accordance with an embodiment of thepresent invention. As illustrated in FIG. 1, the funding programincludes an employer 120 (or union or association in some embodiments),a captive insurance company 130, a Voluntary Employee BeneficiaryAssociation (VEBA) trust 140 and a third party insurance company 150.

FIG. 3 is a flow chart illustrating the operation of a funding programin accordance with an embodiment of the present invention. As bestillustrated in FIG. 3, but with reference to FIG. 1, the employer 120establishes a VEBA trust 140 in a first step 310. Next, in step 320, theemployer 120 funds the VEBA trust 140. With the funding 12, the VEBAtrust 140, as indicated by step 330, purchases Trust Owned LifeInsurance (TOLI) policies and/or non-cancelable accident and healthinsurance (hereinafter collectively referred to as “policies”) from athird party insurance company 150. The third party life insurancecompany 150 reinsures the policies with the employer's captive insurancecompany 130. Accordingly, as illustrated by step 340, the captiveinsurance company 130 reinsures and assumes some or all of the riskassumed by the third party insurance company 150.

As illustrated in the embodiment of FIG. 1, the employer 120 and thecaptive insurance company 130 have a subsidiary relationship 11.Specifically, in some embodiments, the captive insurance company 130 maybe a wholly owned subsidiary of the employer. Alternatively, in otherembodiments, the captive insurance company 130 may be a partially ownedsubsidiary of the employer 120. In fact, there are several arrangementsbetween the captive insurance company 130 and the employer 120 thatwould provide similar benefits as a subsidiary relationship 11. As wouldbe readily understood by a person of ordinary skill in the art, a groupcaptive insurance company (i.e., a captive insurance company that isshared between a group of employers 120) may provide similar advantageswhile reducing the cost attributed to each employer. These types ofcaptive insurance companies may be referred to as risk retention groupsor association captives. Alternatively, other forms of captive insurancecompanies 130 may include, for example, agency captives, branch captivesand rent-a-captives.

In general, however, the captive insurance company 130 is defined by thedomicile of the captive insurance company. For example, in embodiments,the captive insurance company may be domiciled in Vermont (generally a“captive friendly” state). According to Title 8, Section 6001 of theVermont Statute definition of a captive insurance company is any purecaptive insurance company, association captive insurance company,sponsored captive insurance company, industrial insured captiveinsurance company, or risk retention group formed or licensed under theprovisions of this chapter. For purposes of this chapter, a branchcaptive insurance company shall be a pure captive insurance company withrespect to operations in this state, unless otherwise permitted by thecommissioner. The section further defines, for example, a pure captiveinsurance company as any company that insures risks of its parent andaffiliated companies or controlled unaffiliated business. Thesedefinitions are exemplary of statutes that may exist in other states aswell. Of course, as would be generally understood by a person ofordinary skill in the art, many variations of the definition may existbased on for example, the domicile of the captive insurance company 130.In other embodiments, the term “captive” is used generally to describean insurance company that insures the risk of its owners who are not inthe business of insurance.

As would be understood by a person of ordinary skill in the art, each ofthese captive insurance company examples have their respective benefitsand should be selected to meet an employer's needs. Additionally, thepresent invention should not be limited to the specific types ofcaptives discussed above, any type or form of captive insurance companywould fall within the scope of the present invention.

In the embodiment illustrated in FIG. 1, the employer 120 and the VEBAtrust 140 exchange funds. The funding 12 can occur in numerous manners,for example, the funding 12 may be an initial funding, a periodicfunding and/or a non-periodic funding. The funding provides the VEBAtrust 140 with assets/money. Additionally, as shown in the embodiment ofFIG. 1, the VEBA trust 140 reimburses 15 the employer 120. Specifically,in the illustrated embodiment, the employees/retirees 110 may make aclaim to the employer which may be reimbursed by the VEBA trust 140.Examples of claims may include, for example, reimbursement for medicalexpenses, death benefit, etc.

FIG. 4 is a flow chart illustrating one procedure by which benefits maybe paid when an employee/retiree makes a claim in accordance with anembodiment of the present invention. Upon receipt of the claim, as shownby step 410, the employer 120 will pay the claim 10, illustrated by step420. After paying the claim 10, in step 430, the VEBA trust 140 mayreimburse the employer 120 for at least a portion of the claim 10.Additionally, in embodiments of the present invention wherenon-cancelable accident and health insurance, and more specifically, ahealth insurance contract is used, the claim may trigger a payment fromthe policy for the claim on behalf of the insured.

As would be understood by a person skilled in the art, variousmodifications of this embodiment may be possible. For example, the claimmay be paid directly by the VEBA trust 140 or it might not be theemployee/retiree 110 making a request, it may be a third party such as ahospital or a creditor of the employee/retiree 110. Additionally, arequest may not even be required in some embodiments. Specifically, theemployer 120 or VEBA trust 140 may have some other arrangement in placeto pay for these benefits, for example, by paying a third party tohandle such claims.

Additionally, although the above embodiment describes a VEBA trust 140,it should be understood that any trust may be utilized within the scopeof this invention. The VEBA trust is established under Title 26 of theU.S. Code and there are several benefits of VEBA trusts that make itsuse beneficial. For example, some permissible benefits that a trust(including, for example, a VEBA) may pay for include life, health,accident, and other benefits to participants. The other benefits,according to Treasury regulations, may include vacation benefits,subsidized recreational activities (e.g., athletic leagues), child carefacilities, job readjustment allowances and income maintenance paymentsin case of economic dislocation, temporary living expense loans andgrants in times of disaster, supplemental unemployment compensation,severance benefits, education or training benefits, supplementalexecutive retirement programs (SERP), non-qualified deferredcompensation, and personal legal service benefits. Additionally, thereare tax advantages that an employer may use to their benefit by using aVEBA trust. Of course, these benefits would be apparent to a personskilled in the art. Other trusts may also be used. For example, a Rabbitrust or Grantor trust are other examples of trusts that may bebeneficial in the context of the present invention. Other trusts thatmay be beneficial will depend on the employer's specific situation.Additionally, it should be understood by a person skilled in the artthat certain trusts may be owned by employees of the employer instead ofthe employer directly.

As previously mentioned, the VEBA trust 140 may purchase life insurancecontracts and/or non-cancelable accident and health insurance contractswith the funds that it receives. As illustrated in FIG. 1, the VEBAtrust 140 pays premiums 13 to a third party insurance company 150. Thethird party insurance company 150 issues an insurance policy where anemployee, former employee, or retiree, or a group of such employees,former employees, or retirees (or any combination thereof) is theinsured and the VEBA trust 140 is the beneficiary of the life insurancecontract. Accordingly, when the insured person dies or makes a claim,the third party insurance company 150 pays the beneficiary proceeds orclaim proceeds on behalf of the insured respectively, 14 to the VEBAtrust 140.

In accordance with embodiments of the present invention, the VEBA trust140 may acquire any combination of policies on any group of persons. Ofcourse, as would be understood by a person of ordinary skill in the art,there are legal limits for insurance policies on whom and how much aninsurance policy can be for. For example, many government regulationsrequire that the beneficiary have an “insurable interest” in theperson(s) named on the policy. Accordingly, it would be difficult, butnot out of the scope of the present invention, to select arbitrarypersons to name on life insurance policies.

Additionally, there are often tax advantages to investing in lifeinsurance policies and/or non-cancelable accident and health insurancepolicies. Accordingly, as would be readily understood by a person ofordinary skill in the art, it may, in certain embodiments, be beneficialto invest a maximum acceptable amount of funding from the VEBA trust 140to pay premiums 13 on the policies. For example, in some embodiments,the health insurance policy may be treated as life insurance for taxpurposes. Although, in some embodiments, the VEBA trust 140 assets mayalso be invested 18 in other investment vehicles 160. More about thistype of investment is discussed below.

The policies that are issued by the third party insurance company 150are then reinsured 16 by the employer's captive insurance company 130.By reinsuring 16 the policies, the employer's captive insurance company130 assumes the risk of the policies (i.e., the employer's captiveinsurance company assumes liability for the payment of at least aportion of the beneficiary and claim proceeds 14) from the third partyinsurance company 150 in exchange for a premium paid to the employer'scaptive insurance company 130. Accordingly, the third party insurancecompany is sometimes called a fronting company since the third partyinsurance company may only be involved in administering the policy.Additionally, in some embodiments, the third party insurance company mayalso be secondarily liable for the beneficiary proceeds.

In an embodiment of the present invention, the employer's captiveinsurance company 130 assumes the entire risk from the third partyinsurance company 150; in other embodiments, the employer's captiveinsurance company may only assume a portion of the risk. If the entirerisk is assumed, then the third party insurance company is a frontingcompany. The premiums 13 paid by the VEBA trust 140 may be forwarded tothe employer's captive insurance company 130, often less a fee retainedby the third party insurance company 150 for their initial and ongoingservices.

In some embodiments, the third party insurance company 150 may not benecessary and the employers captive insurance company 130 may simplyassume both roles. Specifically, as illustrated in FIG. 2, which is aschematic drawing of another embodiment of a funding program inaccordance with an embodiment of the present invention, the reinsurancemay not be necessary if the captive insurance company 130 is able toassume both rolls. However, the third party insurance company isbeneficial to the employer, especially if the employer hasemployees/retirees 110 in several states. For example, the employer'scaptive insurance company may not be as large as a traditionalcommercial insurance provider. The limited size of the captive insurancecompany, may, for example, prevent it from being able to write lifeinsurance contracts in all of the necessary states or issue adequatehealth insurance policies. Accordingly, a well established third partyinsurance company 150 may provide this function, generally for a smalladministrative fee. In general, the various functions of an insurancecompany, including administrative functions, paying benefits, andcollecting premiums, may be distributed between the third partyinsurance company and the captive insurance company in any manner thatis acceptable for satisfying the employer's needs.

Additionally, as discussed above. FIG. 2 also illustrates an embodimentof a funding program where the VEBA trust 140 pays benefits directly.

FIG. 5 is a flow chart illustrating how benefits or claims are paid inaccordance with an embodiment of the present invention. As previouslymentioned, if the employer's captive insurance company 130, assumes anyportion of the risk, it may be responsible for paying the beneficiary orclaim proceeds 14 discussed above. Accordingly. FIG. 5 is one embodimentof how the beneficiary proceeds 14 may reach the VEBA trust 140. Whenthe third party insurance company 150 is notified that benefits orclaims on behalf of the insured need to be paid, at step 510, the thirdparty insurance company 150 subsequently pays the beneficiary or claimproceeds 14 to the VEBA trust 140 at step 520. The captive insurancecompany 130 is notified and reimburses the third party insurance company150 for at least a portion of the paid beneficiary proceeds 14, at 530.

As would be readily understood by a person skilled in the art, othervariations of this process may also be utilized. For example, inembodiments, the employer's captive insurance company 130 may pay thebeneficiary proceeds or claims 14 directly to the VEBA trust 140. Thismay provide additional benefits to the employer depending on thespecific situation.

As discussed above, premiums may be paid by the third party insurancecompany 150 to the employer's captive insurance company 130 in exchangefor the employer's captive insurance company 130 assuming the risk.Depending on various laws that may exist related to how the employer'scaptive insurance company utilizes the funds that it receives, theemployer's captive insurance company 130 invests 17 its funding intoinvestment vehicles to generate additional funds.

In one embodiment, for example, a life insurance contract may beconfigured to maximize the cash value of the contract. The cash value ofa life insurance contract, as would be readily understood by a person orordinary skill in the art, is the current value of the assets thatsupport the benefits under the life insurance contact. Generally, andwithin legal limits and for a given level of death benefits, this valueis maximized by paying a premium that is equal to the required amountfor a fixed value policy plus some additional amount that accumulatesover time to increase a cash value. For example, if a $1 million policyhas mortality and administrative costs of $400 per year, a policyholder, in this case the VEBA trust 140, may pay $1000 per year insteadof the minimum $400. In this case, an additional $600 per year isinvested at a predetermined or variable rate of return. Over time theaccumulation of the $600 annual payments increases the cash value of thelife insurance policy. In some cases, the return on the cash value mayeventually be enough to pay the $400 minimum such that the insurancepolicy is kept in force without additional premium payments.Additionally, in certain embodiments, the policy value may also increasesuch that when the beneficiary proceeds 14 are paid, the proceeds maytotal, for example, $1.5 million.

In another embodiment, for example, a non-cancelable accident or healthinsurance contract may be configured to accumulate cash value in thecontract. The cash value of such a contract, as would be readilyunderstood by a person or ordinary skill in the art, is the currentvalue of the assets that support the anticipated claims under thecontact. For example, if a policy has anticipated claims andadministrative costs of $400 per year, a policy holder, in this case theVEBA trust 140, may pay $1000 per year instead of the minimum $400. Inthis case, an additional $600 per year is invested at a predetermined orvariable rate of return. Over time the accumulation of the $600 annualpayments increases the reserves of the policy. In some cases, the returnon the reserves may eventually be enough to pay the $400 minimum suchthat the annual claims and administrative expenses are paid frominvestment income generated by the reserves without the need foradditional premiums.

The employer's captive insurance company 130, uses the additional funds,over its minimum premium and in some embodiments an additionaladministrative fee, and invests this funding in investment vehicles 160.

Several investment vehicles may be utilized by either the employer'scaptive insurance company 130 and or the VEBA trust 140. One suchinvestment vehicle is an investment in the employer's own securitiesincluding the employer's short term commercial paper. The short termcommercial paper provides the necessary return that a captive insurancecompany or trust may seek while maintaining the liquidity of the assets.Liquidity, as should be readily understood by a person of ordinary skillin the art, may be important since both the captive insurance companyand the VEBA trust may need to make fairly large payments without muchnotice.

As would be understood by a person skilled in the art, otherconventional investment vehicles 160 either alone or in combination withshort term commercial paper or any other investment vehicles 160 wouldalso be acceptable. Examples of some other investment vehicles mayinclude, for example, commercial stocks, bonds, commodities, realestate, interest bearing accounts, etc.

The principles and features of the present invention may also beimplemented in a computer readable medium. For example, a computer canbe programmed to establish a funding system in accordance with theprinciples described above that meets an individual employer's needs.

In one embodiment, the computer program would be programmed to includeinformation on the laws regarding the VEBA trust 140, the third partyinsurance company 150, and the employer's captive insurance company 130.The incorporated laws may include, for example, the required legalstructure of each entity, the maximum and minimum funding required foreach entity, the types of activities which may be regulated for eachentity, and the tax advantages and disadvantages of using each entity.Of course, as would be understood by a person of ordinary skill in theart, other information that may be relevant may also be included. Theprogram would accept, as inputs, several key pieces of informationregarding the employer 120. For example, this information, in oneembodiment may include, the legal structure of the employer 120, thebenefits liability of the employer 120, the assets of the employer 120,and the projected future liabilities and assets of the employer 120.Based on these inputs and the information stored within the program, theprogram may be able to determine what structure the funding systemshould embody, how much funding should be provided to the trust, whetherlife insurance or non-cancelable accident and health insurance should bepurchased, what type of trust should be utilized, whether a third partyinsurance company 150 should be utilized, which third party insurancecompany 150 should be utilized, what type of captive insurance company130 should be utilized, and what type or types of investment vehiclesshould be utilized.

Of course, the above computer implemented method is merely an embodimentof the present invention, and it should be understood that variousmodifications, additions, and deletions are contemplated depending onthe particular situation.

In additional embodiments, the computer implemented method may also beimplemented to optimize certain aspects of the present invention. Theabove program described a computer implemented method that assisted anemployer in determining the most advantageous arrangement for fundingbenefits. Once the arrangement is determined, it may be beneficial foremployers to optimize the arrangement to their specific needs. In oneembodiment, the software may be utilized for any combination ofadministration of the funding system, optimization of the fundingsystem, performance tracking of the funding system, or managing of thefunding system.

For example, the software may be configured to maximize the cash valueof the life insurance policies while allowing a user to track the assetsand liabilities of the system and determine future projections for thestate of the system. In another embodiment, the software may allow auser to optimize the amount of funds that are paid to the trust tooptimize the tax benefits of the funding system. In another embodiment,the software may be able to determine the optimum investment strategyfor the funds provided to the trust or to the captive insurance company.In another embodiment, the software may be able to forecast claim to bepaid under a non-cancelable accident and health insurance contract.

FIG. 6 is a flow chart of a computer system relating to or forimplementing a funding program in accordance with an embodiment of thepresent invention. The computer system of FIG. 6 includes user inputs610, a computer 620, and a display 680. In this embodiment, the computer620 includes 5 modules; a configuration module 660, an optimizationmodule 640, a management module 630, an administrative module 650, andan accounting module 670. The computer can be any electronic devicecapable of performing the desired function. Likewise, the modulesdescribed can be discrete or integrated and can be implemented insoftware or hardware. As described above, the user inputs 610 mayinclude a number of relevant parameters including, for example,information regarding the corporate structure, the corporate assets, andthe corporate liabilities. These user inputs may be input into thecomputer 620 via a distributor 625. The distributor 625, gathers theinformation and forwards it to at least one of the modules. Often, thedistributor 625 may also convert the data into a form that is moreeasily interpreted by the modules. The modules each contain parametersand calculating means for using the user inputs 610, where necessary, toobtain the relevant outputs. Additionally, in some embodiments, themodules may be able to communicate with each other. As discussed above,and in more detail below, these parameters and calculating means can beany appropriate information. For example, with respect to the managementmodule 630, the user inputs 610, information from the configurationmodule 660, information from the optimization module 640 and theparameters specific to the management module, may be used to allow auser to determine several management parameters. Based on, for example,the configuration module 660, the management module may track assets inthe trust account, assets paid by the employer, investment return, orproceeds from the reinsurance from the captive insurance company.Additionally, based on the optimization module 640 information and theuser inputs 610, the management module 630 may be able to determine, forexample, that additional assets are necessary from the employer in sixmonths to ensure the trust is properly funded. Additionally, reports canbe generated related to paid benefits, or other parameters. The detailsof the interaction of these parameters are discussed below.

Additionally, as seen in FIG. 6, to allow a user to utilize theinformation calculated by the modules (e.g., the software program),outputs are displayed on a display 680 via a compiler 675. The compiler675 allows the computer 620 to use the output from several modules, forexample the accounting module 670 and optimization module 640, at thesame time. Since these parameters may be interconnected, it may, in someembodiments, be beneficial for a user to be able to view the informationsimultaneously. Of course, FIG. 6 is exemplary and several variations ofthe embodiment of FIG. 6 should be apparent to a person of ordinaryskill in the art.

Several variations for optimization, reporting, administration, trackingand managing will be apparent to a person of ordinary skill in the art.Generally, however, the list below illustrates several variables orassumptions that may be beneficial for the computer implemented system(or the method in general) of the present invention.

-   (1) Year The number of years the software may calculate data for.-   (2) Number of Lives Covered The starting number of participants.    Lives May assume death rates based on any Covered acceptable means.    May also account for new employees.

Policy Accounting

-   (3) Insurance Face Amount Face amounts are set for the policy to    qualify as Life Insurance and to determine whether the policy is    treated as a Modified Endowment Contract (MEC) or not.-   (4) Premium Assets paid to trust to establish and fund the life    insurance contract and/or the non-cancelable accident and health    insurance.-   (5) Number of Deaths/Claims Estimated number of deaths and/or claims    are computed based on any acceptable means.-   (6) Death Benefits/Proceeds of Claims Paid Death benefits are    actuarially determined by the expected deaths and the insurance face    amounts.-   (7) Loads Basis points charged to the policy.-   (8) Surrenders The amount of cash value that is withdrawn or    surrendered. May also be a partial surrender.-   (9) Investment Earnings Expected investment return rate based    Earnings on any acceptable means.-   (10) End of Year Cash Value Based on actuarial projections.-   (11) End of Year Basis Based on actuarial projections.-   (12) Policy Cash Flow Premium adjusted for death benefits and    surrenders. From the corporate point of view, this is the amount of    money the employer is spending on the policy or getting back from    it.

Captive Cash Flow

-   (13) Direct Premium The same as (4),-   (14) Reinsurance Ceded Mortality risk is assumed to be reinsured. It    assumes a percentage load by the reinsurance company.-   (15) Net Premium Direct premium less reinsurance ceded. This is the    net annual premium amount retained by the captive.-   (16) Total Death/Claim Benefits Death/Claim benefits are calculated    based on the pre-determined group premium (4).-   (17) Reinsurance Recovery Generally equal to the benefits received    from the reinsurer.-   (18) Net Death/Claim Benefits Total Death/Claim Benefits (16) less    Reinsurance Recovery (17). Net Death/Claim Benefits may be paid from    the Cash Value.-   (19) Surrenders The same as (8).-   (20) Premium Tax Premium tax is calculated based on the sliding    scale. For example, Vermont captive insurance premium tax rates are    applied to direct premiums.-   (21) Expenses Program administration expenses for this program.-   (22) Investable Assets These are the assets generating investment    earnings. Beginning of year invested assets (24) plus annual net    premium adjusted for death/claim benefits (18), surrenders (19),    expenses (21) and DAC Tax (30).-   (23) Investment Earnings Investment earnings based on any acceptable    means.-   (24) Cash Tax Expense Captive's annual income tax (46) adjusted for    DAC Tax.-   (25) Beginning of Year Invested Assets Prior year's End of Year    Invested Assets (25), $0 in year 1.-   (26) End of Year Invested Assets Beginning of Year Invested    Assets (25) plus Investment Earnings (23) and Net Premium (15), less    Net Death/Claim Benefits (18), Surrenders (19), Premium Tax (20),    Expenses (21) and Cash Tax Expense (24). Deferred Acquisition Cost    (DAC)-   (27) Current Year DAC The lesser of a given percentage of premiums    and the captive expenses (premium tax and administration expenses).-   (28) Amortization DAC amortization,-   (29) Unamortized DAC Prior year's Unamortized DAC (prior DAC    year's 29) plus Current Year DAC (27) minus Amortization (28).-   (30) Deferred Tax Asset Accumulated DAC payments that will be    recovered through future amortization. A percentage tax is applied    to the Unamortized DAC (29).

The Captive Income Statement Section Below Represents the Impact of thePolicy Transaction on the Captive's Income Statement

-   (31) Direct Premiums The same as (4).-   (32) Reinsurance Ceded The same as (14).-   (33) Net Premiums The same as (15).-   (34) Investment Income The same as (23).-   (35) Gross Income Net Premiums (33) plus Investment Income (34).-   (36) Death/Claim Benefits Benefits Incurred The same as (6).-   (37) Reinsurance Recoveries The same as (17).-   (38) Net Death/Claim Benefits The same as (18).-   (39) Surrenders The same as (19).-   (40) Increase in Policy Reserves Equal to the annual change in End    of Year Cash Value (annual change in 10).-   (41) Total Benefit Expense The total benefit expense paid by the    captive; Sum of Net Death Benefits Expense (38), Surrenders (39),    Increase in Policy Reserves (40).-   (42) Premium Tax The same as (20).-   (43) Other Expense The same as (21).-   (44) Total Expense Sum of Total Benefit Expense (41), Premium Tax    (42), Other Expense (43).-   (45) Pretax Income Gross Income (35) minus Total Expense (44).-   (46) Income Tax A percentage tax that is applied to Pre-tax income    (45).-   (47) Net Income Pretax Income (45) minus Income Tax (46).

The Captive Balance Statement Section Below Represents the Impact of thePolicy Transaction on the Captive's Balance Sheet

-   (48) Investments Equal to the End of Year Invested Assets (26).-   (49) Unamortized DAC Equal to the Deferred Tax Asset (30).-   (50) Total Assets Investments (48) plus Unamortized DAC (49)*-   (51) Liabilities (Policy Reserves) Equal to the End of Year Cash    Value (10),-   (52) Capital Additional funds needed for capital. If captive is    already capitalized, no additional funds will be needed for capital.-   (53) Retained Earnings Net Income (47) plus prior year's Retained    Earnings (53)-   (54) Total Shareholder Equity Capital (52) plus Retained Earnings    (53).-   (55) Total Liabilities and Equity Liabilities (Policy Reserves) (51)    plus Total Shareholder Equity (54).

Financing/Alternative Use of Assets The Section Below Computes theOpportunity Cost of Captive Funding. The Cash That would have been UsedElsewhere, I.E., the Employer's Other Investments in the Initial Years,Will be Consolidated Under the Life Insurance Program

-   (56) Policy Cash Flow The same as (12).-   (57) Capitalization of Captive The same as (52).-   (58) P&C Premium Effected Amount of P&C premium that is affected by    the employee benefits funding. For example, IRS Revenue Ruling    2002-89 requires that 50% of the captive's business stem from    unrelated parties (e.g. employee benefits) for the remaining P&C    premiums to be deductible.-   (59) Accumulated P&C Deduction P&C reserves that can be used to    determine deductible amount.-   (60) Current P&C Deduction Annual change in the accumulated P&C    Deduction (annual change in 59).-   (61) P&C Deduction Value Value of the accelerated tax deduction. A    percentage tax rate applied to the Current P&C Deduction (60).-   (62) Net Cash Flow Difference The amount that employer needs to    finance. Sum of Policy Cash Flow (56), Capitalization (57) and P&C    Deduction Value (61).-   (63) Beginning of the Year Exchanged COP What a company owned policy    (COP) would be worth if the Plan Value continued to hold it. Prior    year's Beginning of Year Value of Exchanged COP policy (prior    year's 63) plus Expected Earnings (65). In year 1, COP Exchanged-   (64) is also included in the Beginning of Year Value Exchanged COP.-   (64) COP Exchanged Expected value of the COP assets that will be    transferred to the Policy program when the benefits are funded    through the captive.-   (65) Expected Earnings Beginning of Year Value Exchanged COP (63)    earnings adjusted for the COP policy load (80 bp).-   (66) Beginning of Year Assets The assets that have not yet been sold    to finance the policy. Prior year's Beginning of Year Assets (66)    plus prior year's Tax Effect minus prior year's assets sold. For    year 1, this is the amount of current assets.-   (67) Asset Earnings The amount of assets the program would have had    if the assets had not been transferred to the Policy program.    Earnings at an assumed rate on the assets available for investments,    i.e., Beginning of Year Assets (66) adjusted for Assets Sold (70).-   (68) Tax Effect Percentage tax rate applied to Asset Earnings (67).-   (69) Beginning of Year Assets Sold Prior year's Asset Sold (prior    year's 70) plus prior year's Expected Earnings (prior year's 71)    minus prior year's Tax Effect (prior year's 72).-   (70) Assets Sold Sell assets when the Beginning of Year Value Assets    Sold-   (69) is positive to cover the Net Cash Flow Difference (62) if COP    Exchanged (64) alone is unable to pay out the Net Cash Flow    Difference (62).-   (71) Expected Earnings Expected earnings at a determined percentage    on net assets investable into mutual funds in a given year; i.e.    percentage applied to Beginning of Year Value SERP Mutual Funds    Sold (69) plus Mutual Funds Sold (70).-   (72) Tax Effect Percentage tax on Expected Earnings (71).    Loan/Repayment accounting. This section illustrates the impact of    the Policy transaction on the loans of the employer.-   (73) Beginning of Year Loan Balance When COP Exchanged (64) and    Assets Sold (70) are not enough to meet Net Cash Flow Difference    (62), loans are needed to cover the Net Cash Flow Difference (62).    This amount is equal to the prior year's End of Year Loan Balance    (prior year's 77).-   (74) (Borrowing)/Repayment Net Cash Flow Difference (62) less    Repayment COP Exchanged (64); Mutual Funds Sold (70), other Debt    Incurred, and Other Assets Sold.-   (75) Value of Funds Interest on Beginning of Year Loan Funds    Balance (73) and (Borrowing)/Repayment (74).-   (76) Tax Effect Tax impact of loan interest. Value of Funds (75)    times tax rate.-   (77) End of Year Loan Balance Beginning of Year Loan Balance (73)    adjusted for additional loans, interest and tax impact of interest;    Sum of Beginning of Year Loan Balance (73),    (Borrowing)/Repayment (74) and Value of Funds (75), less Tax Effect    (76).

The Unconsolidated Earnings Impact (Employer) Section Below Representsthe Impact of the Policy Transaction on Employer's Income Statement

-   (78) Investment Earnings Equal to Expected Earnings (71) of Assets,    which is the earnings if the assets would not have been sold.-   (79) Other Income Policy earnings offset by reserve earnings. Note:    Other Income may not be subject to tax. Sum of Increase in Policy    Reserves (40), Policy Cash Flow (56) and Expected Earnings (65) on    the COP Exchanged.-   (80) Total Revenue Investment Earnings (78) plus Other Income (79).-   (81) Interest Expense/Credit Interest expense/credit on corporate    debt. Equal to −Value of Funds (−75).-   (82) Pretax Income Total Revenue (80) minus Interest Expense (81).-   (83) Tax Tax on Expected Earnings on (72) plus tax impact of the    loan (76).-   (84) After-tax Income Pretax income (82) minus Tax (83). Generating    book value while generating tax deductions.

The Unconsolidated Balance Sheet Impact (Employer) Section BelowRepresents The Impact of the Policy Transaction on Employer's BalanceSheet

-   (85) Cash and Investments Reduction in investments due to the sale    of assets. Equal to the following year's Beginning of Year Value    SERF assets Sold (the following year's 69).-   (86) Other Assets Increase in the Life Insurance Assets and/or    Non-Cancelable Accident and Health Insurance Assets. Liabilities    (Policy Reserve) (51) plus the following year's Beginning of Year    Value Exchanged COP (the following year's 63).-   (87) Deferred Tax Asset If employer carries a Deferred Tax Asset    which they would recognize when claims are paid in the future. That    deduction may now be accelerated under the captive program and will    be converted into cash. Accumulation of P&C Deduction Value    (accumulation of 61).-   (88) Investments In Captive Accumulation of the Capitalization of    the Captive (accumulation of 57). If the captive is already    capitalized, there is no initial capital and subsequent accumulation    of capital.-   (89) Total Assets Sum of Cash and Investments (85), Other Assets    (86), Deferred Tax Asset (87) and Investments in Captive (88).-   (90) Liabilities/Loans Equal to the End of Year Loan Balance (77).-   (91) Shareholder Equity Accumulation of After-tax Income    (accumulation of 84).-   (92) Total Liabilities and Equity Liabilities/Loans (90) plus    Shareholder Equity (91).

Consolidated Impact

-   (93) Net Income Consolidated Net Income of the captive and employer.    Captive's Net Income (47) plus Employer's After-tax Income (84).-   (94) Shareholder Equity Consolidated shareholder equity of the    captive and Employer. Captive's Shareholder Equity (54) plus    Employer's Shareholder Equity (91).

In embodiments, any combination of these variables, and others that willbe apparent to a person skilled in the art, can be used to establish,optimize, report, administer, track, and manage the funding system ofthe present invention. Additionally, some of the above variables may beinput by a user, others may be internally determined based on severalfactors. In one embodiment, the effective tax rates may be determinedaccording to current state and federal regulations. In otherembodiments, a user may be able to input a percentage for the same taxrates. Additionally, as would be understood by a person skilled in theart, some of these variables may be determined by complex statisticalmodels. For example, the death rate may be a complex statisticaldistribution or a simple rate. For some employers, it may be sufficientto indicate that, for example, a death rate of 2 people per year.However, in other embodiments, the employer may desire a particulardistribution of the deaths. Several models may be used, in thisembodiment, based on the employer's needs. Additionally, all thevariables presented above may not be applicable to both life insurancepolicies and non-cancelable accident and health insurance policies. Theapplicability of these variables should be apparent to a person skilledin the art.

The embodiments described herein are intended to be illustrative of thisinvention. As will be recognized by those of ordinary skill in the art,various modifications and changes can be made to these embodiments andsuch variations and modifications would remain within the spirit andscope of the invention defined in the appended claims and theirequivalents. Additional advantages and modifications will readily occurto those of ordinary skill in the art. Therefore, the invention in itsbroader aspects is not limited to the specific details andrepresentative embodiments shown and described herein

1. A computer implemented system for projecting, administering ormanaging a benefits funding system comprising: an input device foraccepting user inputs related to the number of people receiving benefitsfrom an employer; a calculating module for calculating an initial amountand periodic amount that said employer should contribute to a trustaccount, said calculating means using at least said user input forcalculating; a determining module for determining premiums paid in aperiod, number of deaths in said period, amount of proceeds for claimsreceived in said period, and investment earning in said period; anaccounting module for calculating, based on said premiums paid in saidperiod, number of claims in said period, amount of proceeds for claimsreceived in said period, investment earning in said period, and a taxeffect, an amount of tax owed by said trust or said employer and anincrease in assets of said employer; a compiling module for compilingthe number of people receiving benefits, said initial amount and saidperiodic amount that said employer should contribute to said trust, saidpremiums paid in said period, the number of claims in said period, theamount of proceeds for claims received in said period, investmentearning received in said period; said tax effect, said amount of taxowed by said trust or said employer and said increase in assets of saidemployer, said compiling means compiling said information for saidperiod and determining the same information for future, successiveperiods, said information for said current and future periodsconstituting complied information; and a displaying device fordisplaying the compiled information in a user viewable form.
 2. Acomputer implemented method for funding benefits, said computerimplemented method comprising: accepting inputs related to specificemployer information; determining an amount of funding to provide to anemployer or employee owned trust account; calculating what portion ofsaid funding to use to purchase at least one life insurance contract orat least one non-cancelable accident and health insurance contract;determining whether to purchase said at least one life insurancecontract or non-cancelable accident and health insurance contract from athird party insurance company or a captive insurance company; anddetermining what portion of said at least one life insurance contract ornon-cancelable accident and health insurance contract should bereinsured by said captive insurance company if said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract is purchased from said third party insurance company; whereinsaid trust is the beneficiary of said at least one life insurancecontract or non-cancelable accident and health insurance contract. 3.The computer implemented method of claim 2, wherein said at least onelife insurance policy or non-cancelable accident and health insurancecontract is purchased from said third party life insurance company. 4.The computer implemented method of claim 2, further comprising:estimating benefit amounts to be paid or reimbursed by said employer orsaid trust.
 5. The computer implemented method of claim 2, furthercomprising, determining what commercially available vehicles said atleast one of said trust and said captive insurance company investsassets in to generate additional assets.
 6. The computer implementedmethod of claim 2, further comprising determining that said captiveinsurance company invests at least a portion of assets in securities ofsaid employer.
 7. The computer implemented method of claim 6, whereinsaid securities is short term commercial paper of said employer.
 8. Thecomputer implemented method of claim 2, further comprising, determinewhether said captive insurance company should be partially owned by saidemployer or wholly owned by said employer.
 9. The computer implementedmethod of claim 2, further comprising, determining whether said trustshould be a Voluntary Employee Benefit Association Trust.
 10. Thecomputer implemented method of claim 2, further comprising, determiningwhether said trust should be a Rabbi Trust.
 11. The computer implementedmethod of claim 2, further comprising, determining which individualsreceiving benefits from said employer should be an insured on said atleast one life insurance contract or non-cancelable accident and healthinsurance contract.
 12. The computer implemented method of claim 2,further comprising, configuring said at least one life insurancecontract or non-cancelable accident and health insurance contract tomaximize a cash value of said at least one life insurance contract ornon-cancelable accident and health insurance contract for apredetermined period of time, or to optimize at least one of a premium;a liability or another variable in accordance with an employer's needs.13. A computer system for funding benefits, said computer systemcomprising: inputs means for accepting user inputs related to specificemployer information; calculating means for determining an amount offunding to provide to a trust account; calculating means for determiningwhat portion of said funding to use to purchase at least one lifeinsurance contract or non-cancelable accident and health insurancecontract to optimize a tax benefit to said employer; determining meansfor determining whether to purchase said at least one life insurancecontract or non-cancelable accident and health insurance contract from athird party insurance company or a captive insurance company; anddetermining means for determining what portion of said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract should be reinsured by said captive insurance company if saidat least one life insurance contract or non-cancelable accident andhealth insurance contract is purchased from said third party insurancecompany; wherein said trust is the beneficiary of said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract.
 14. The computer system of claim 13, wherein said determiningmeans determines to purchase said at least one life insurance contractor non-cancelable accident and health insurance contract from said thirdparty life insurance company.
 15. The computer system of claim 13,further comprising: estimating means for estimating benefit amounts tobe paid or reimbursed by said employer or said trust.
 16. The computersystem of claim 13, further comprising, determining means fordetermining what commercially available vehicles said at least one ofsaid trust and said captive insurance company invests assets in togenerate additional assets.
 17. The computer system of claim 13, furthercomprising determining means for determining an amount that said captiveinsurance company invests in securities of said employer.
 18. Thecomputer system of claim 17, wherein said securities is short termcommercial paper of said employer.
 19. The computer system of claim 13,further comprising, determining means for determining whether saidcaptive insurance company should be partially owned by said employer orwholly owned by said employer.
 20. The computer system of claim 13,further comprising, determining means for determining whether said trustshould be a Voluntary Employee Benefit Association Trust or a RabbiTrust.
 21. The computer system of claim 13, further comprising,selecting means for selecting which individuals receiving benefits fromsaid employer should be an insured on said at least one life insurancecontract or non-cancelable accident and health insurance contract. 22.The computer system of claim 13, further comprising, determining meansfor configuring said at least one life insurance contract ornon-cancelable accident and health insurance contract to maximize a cashvalue of said at least one life insurance contract or non-cancelableaccident and health insurance contract for a predetermined period oftime, or to optimize at least one of a premium, a liability or anothervariable in accordance with an employer's needs.
 23. A computerimplemented system for administering or managing a benefits fundingsystem comprising: input means for accepting user inputs related to thenumber of people receiving benefits from an employer; calculating meansfor calculating an initial amount and periodic amount that said employershould contribute to a trust account, said calculating means using atleast said user input for calculating; determining means for determiningpremiums paid in a period, number of deaths or claims in said period,amount of death benefits or proceeds for claims received in said period,and investment earning in said period; accounting means for calculating,based on said premiums paid in said period, number of deaths or claimsin said period, amount of death benefits or proceeds for claims receivedin said period, investment earning in said period, and a tax effect, anamount of tax owed by said trust or said employer and an increase inassets of said employer; compiling means for compiling the number ofpeople receiving benefits, said initial amount and said periodic amountthat said employer should contribute to said trust, said premiums paidin said period, the number of deaths or claims in said period, theamount of death benefits or proceeds for claims received in said period,investment earning received in said period; said tax effect, said amountof tax owed by said trust or said employer and said increase in assetsof said employer, said compiling means compiling said information forsaid period and determining the same information for future, successiveperiods, said information for said current and future periodsconstituting complied information; and displaying means for displayingthe compiled information in a user viewable form.
 24. A method forfunding benefits, said method comprising: funding an employer oremployee owned trust account to aide said employer in providing benefitsfor employees or retirees; and obtaining at least one life insurancecontract or non-cancelable accident and health insurance contract from acaptive insurance company with at least a portion of assets from thetrust account; wherein said trust is the beneficiary of said at leastone life insurance contract or non-cancelable accident and healthinsurance contract.
 25. The method of claim 24, wherein said at leastone life insurance contract or non-cancelable accident and healthinsurance contract is purchased from said third party life insurancecompany and reinsured by said captive insurance company.
 26. The methodof claim 24, wherein: said employer pays said benefits to employees andsaid employer is reimbursed by said trust, or said trust pays saidbenefits directly to said employees.
 27. The method of claim 24, whereinat least one of said trust and said captive insurance company investsassets in commercially available vehicles to generate additional assets.28. The method of claim 24, wherein said captive insurance companyinvests at least a portion of assets in securities of said employer. 29.The method of claim 28, wherein said captive insurance company investsassets in short term commercial paper of said employer.
 30. The methodof claim 24, wherein said captive insurance company is at leastpartially owned by said employer.
 31. The method of claim 24, whereinsaid captive insurance company is a wholly owned subsidiary of saidemployer.
 32. The method of claim 24, wherein said benefits include atleast one of health care benefits, retirement benefits, executivecompensation, disability benefits, and life insurance.
 33. The method ofclaim 24, wherein said trust is a Voluntary Employee Benefit AssociationTrust.
 34. The method of claim 24, wherein said trust is a Rabbi Trust.35. The method of claim 24, wherein an insured on said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract is an individual receiving said benefits from said employer.36. The method of claim 24, wherein said benefits are provided to atleast one of an employee, a former employee, or a retiree.
 37. Themethod of claim 24, wherein said at least one life insurance contract ornon-cancelable accident and health insurance contract is configured tooptimize at least one of a cash value of said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract for a predetermined period of time, a premium, a liability oranother variable in accordance with an employer's needs.
 38. A methodfor funding benefits, said method comprising: funding an employer oremployee owned trust account; purchasing at least one life insurancecontract or non-cancelable accident and health insurance contract withat least a portion of funds from the trust account from a third partyinsurance company, said trust being the beneficiary of said at least onelife insurance policy or non-cancelable accident and health insurancecontract; and reinsuring said at least one life insurance contract ornon-cancelable accident and health insurance contract by a captiveinsurance company.
 39. The method of claim 38, further comprising:paying or reimbursing said benefits by said employer or said trust; andreimbursing said employer from said trust of at least a portion of saidpaying or reimbursing if said paying or reimbursing of benefits is fromsaid employer.
 40. The method of claim 38, wherein at least one of saidtrust and said captive insurance company invests assets in commerciallyavailable vehicles to generate additional assets.
 41. The method ofclaim 38, wherein said captive insurance company invests at least aportion of assets in securities of said employer.
 42. The method ofclaim 41, wherein said captive insurance company invests assets in shortterm commercial paper of said employer.
 43. The method of claim 38,wherein said captive insurance company is at least partially owned bysaid employer.
 44. The method of claim 38, wherein said captiveinsurance company is a wholly owned subsidiary of said employer.
 45. Themethod of claim 38, wherein said benefits include at least one of healthcare benefits, retirement benefits, executive compensation includingSERF or deferred compensation, disability benefits, or life insurance.46. The method of claim 38, wherein said trust is a Voluntary EmployeeBenefit Association Trust.
 47. The method of claim 38, wherein saidtrust is a Rabbi Trust.
 48. The method of claim 38, wherein an insuredon said at least one life insurance contract or non-cancelable accidentand health insurance contract is an individual receiving said benefitsfrom said employer.
 49. The method of claim 38, wherein said benefitsare provided to at least one of an employee, a former employee, or aretiree.
 50. The method of claim 36, wherein said at least one lifeinsurance contract or non-cancelable accident and health insurancecontract is configured to maximize a cash value of said at least onelife insurance contract or non-cancelable accident and health insurancecontract for a predetermined period of time, or to optimize at least oneof a premium, a liability or another variable in accordance with anemployer's needs.
 51. A system for funding benefits, said systemcomprising: a third party insurance company; a trust, said trust beingfunded by an employer and using at least a portion of said funding topurchase at least one life insurance contract or non-cancelable accidentand health insurance contract from said third party insurance company,said life insurance contract or non-cancelable accident and healthinsurance contract naming as an insured, at least one employee, formeremployee, or retiree entitled to receive benefits from said employer;and a captive insurance company, said captive insurance companyreinsuring said at least one life insurance contract or non-cancelableaccident and health insurance contract; wherein said trust is abeneficiary of said at least one life insurance contract ornon-cancelable accident and health insurance contract.
 52. The system ofclaim 51, wherein said benefits are paid or reimbursed by said employeror said trust and, if said employer pays or reimburses said benefits,said trust reimburses said employer for at least a portion of saidpayment.
 53. The system of claim 51, wherein at least one of said trustand said captive insurance company invests assets in commerciallyavailable vehicles to generate additional assets.
 54. The system ofclaim 51, wherein said captive insurance company invests at least aportion of assets in securities of said employer.
 55. The system ofclaim 54, wherein said captive insurance company invests assets in shortterm commercial paper of said employer.
 56. The system of claim 51,wherein said captive insurance company is at least partially owned bysaid employer.
 57. The system of claim 51, wherein said captiveinsurance company is a wholly owned subsidiary of said employer.
 58. Thesystem of claim 51, wherein said benefits include at least one of healthcare benefits, retirement benefits, disability benefits, or lifeinsurance.
 59. The system of claim 51, wherein said trust is a VoluntaryEmployee Benefit Association Trust.
 60. The system of claim 48, whereinsaid trust is a Rabbi Trust.
 61. The system of claim 51, wherein said atleast one life insurance contract or non-cancelable accident and healthinsurance contract is configured to maximize a cash value of said atleast one life insurance contract or non-cancelable accident and healthinsurance contract for a predetermined period of time, or to optimize atleast one of a premium, a liability or another variable in accordancewith an employer's needs.
 62. A method for determining a benefitsfunding system using a computer system, said method comprising:inputting information regarding an employer, said information includingat least one of employer assets and employer benefits liability;calculating, based on said input information and at least one of amortality assumption model and an insurance calculator, at least one ofpremiums for life insurance contracts or non-cancelable accident andhealth insurance contract, policy benefits, and investment income;determining, based on said at least one of premiums for life insurancecontracts or non-cancelable accident and health insurance contract,policy benefits, and investment income, an amount required to fund saidtrust; reporting an amount of reinsurance to be obtained from a captiveinsurance company.